Zak Mir takes a charting look at some of the most closely followed small caps on the London Stock Exchange. Today’s charts are FTSE 100, DAX, Dow, Bitcoin, Gold, Ariana, Blue Star, Capai, Earnz, Eurasia, Gem Resources, Hamak, Likewise, Narf, Quantum Blockchain, Tungsten West, Wishbone.
FTSE 100: Holding Support and Eyeing New Highs
The FTSE 100 has demonstrated resilience, successfully finding support at the 8,700 level. Earlier concerns about a potential dip to 8,661 on the 50-day moving average—similar to the DAX’s movement—have been alleviated. The market closed above 8,800, a key threshold we’ve been anticipating, signaling strength and momentum.
Looking ahead, the FTSE could climb as high as 9,030 by the end of next month, potentially breaking new highs and sparking optimism. The RSI (Relative Strength Index) has bounced back to 53 after briefly dipping below the neutral 50 mark, reinforcing the positive outlook. The 50-day moving average remains a critical support level, and sustaining gains above 8,800 through today or early next week would set the stage for a strong finish to July, possibly reaching or surpassing 9,000.
DAX: Strong Support and Upward Momentum
The DAX is showing encouraging signs with multiple gap-ups this month, including today’s session. Support is firmly established around the 23,400 to 23,500 range, which was previously resistance in March, creating a solid foundation for further gains.
The index could test the top of its rising channel near 24,900 by the end of next month. The RSI is healthy at 54, having bounced off the neutral 50 level, indicating renewed buying interest. This rebound suggests the DAX is poised for upward momentum in the near term.
Dow Jones: Breaking Resistance and Targeting New Records
The Dow has been the “problem child” among the major indices but has recently made a decisive break above the stubborn resistance zone around 42,843. This breakout, coupled with a double bounce in the RSI off neutral 50, signals a bullish turn.
Current resistance up to 44,000 appears limited, with potential to reach the 45,000 record level soon, or even stretch toward the top of its rising trend channel at approximately 47,300. This upward squeeze is partly due to many investors selling out during tariff-related dips, reducing seller pressure and allowing prices to climb.
Key support lies at 42,000, ideally not falling below the 200-day moving average at 42,500. Investors should watch for a potential golden cross between the 50 and 200-day lines, which would be a strong bullish signal.
Bitcoin: Consolidating Above Key Support
Despite widespread enthusiasm for Bitcoin as a treasury strategy asset, the price has yet to skyrocket as some might expect. Currently, Bitcoin is holding above its 50-day moving average, pausing just below resistance around 109,000.
A close above this level could ignite a push toward the top of its channel near 125,000 by the end of next month, a move that would boost confidence among Bitcoin investors, especially following recent volatility.
Gold: Struggling to Sustain Momentum
Gold is facing challenges maintaining its position at the floor of a steeply rising trend channel that began in March. The 50-day moving average is acting as a crucial support zone, currently around 3,250.
The RSI is below 50, suggesting further downside risk and the possibility of probing the 3,250 support level again. On the upside, breaking above resistance at 3,375—established earlier this week—would signal renewed strength and a potential rally toward the channel’s upper boundary near 3,800 later this summer.
Stock Spotlight: Promising Performers and Key Setups
Ariana Resources: Potential Breakout Play
Ariana Resources caught attention with a strong candle pattern yesterday, opening at the low and closing at the high. The rising 50-day moving average off recent lows indicates building momentum.
Investors should watch for a move toward the 200-day moving average around 1.8 pence by the end of next month. The recent gap-up after a March gap-down forms a bear trap island reversal, suggesting a bullish setup. Given Ariana’s gold exposure, it could be poised for a day in the sun following a tough period.
Blue Star: Bullish Momentum and Big Upside Potential
Blue Star has twice hit its target line around 26 pence and is eyeing a substantial rise to 60 pence. Closing above 26 pence is crucial, as there is little resistance between this level and 60 pence.
The RSI’s multiple bounces off the neutral 50 level confirm a strong bull trend, supported by a V-shaped bull flag pattern—a powerful setup indicating further gains ahead. Blue Star shareholders could enjoy a rewarding summer.
Capai: Watching for a Rally Resumption
Capai faces the challenge of confirming whether its March to May rally will continue. An end-of-day close above the rising 50-day moving average near 0.49 pence and a break above RSI 50 would be positive signals.
If these conditions materialize, Capai could retest May’s resistance at 0.92 pence and potentially reach the top of its rising channel near 1.1 pence by late August. Maintaining recent support around 0.36 pence is critical to this outlook.
Earnz: Gaining Momentum with Key Breakouts
Earnz has garnered renewed interest, bolstered by the involvement of veteran campaigner Bob Holt. The stock recently broke above its 200-day moving average at 5.33 pence for the first time in a long while, signaling strength.
With a rising 50-day average and RSI bounce, Earnz looks set to target 7 pence in the coming weeks, potentially sooner, while holding above the 4 pence level.
Gem Resources: Signs of a Comeback
Gem Resources appears to be turning a corner, trading above its 50-day moving average despite that average trending downward. This scenario often signals a robust recovery.
The initial target is 0.31 pence, with a longer-term goal of 0.74 pence by the end of August. The 200-day moving average near 0.58 pence represents the main resistance level. Holding above 0.20 pence on the 50-day line will be key to sustaining this momentum.
Hamak: Bull Flag and Upside Potential
Following a notable company interview a few months ago, Hamak is forming what’s described as a B-shaped bull flag. The stock aims to retest June resistance at 1.545 pence, with hopes of reaching 3 pence later this summer.
Support near 0.82 pence should hold during this advance.
Eurasia: Bear Trap Rebound and Further Gains
Eurasia has staged a bear trap rebound after dipping below May support at 3.44 pence, pushing through the 50-day moving average. The next logical target is May resistance at 5.15 pence, with the RSI steady at 55.
Maintaining above the channel floor near 3.6 pence will support further upside potential.
Likewise: Surpassing Targets and Eyeing New Highs
Likewise has already exceeded its previous target of 21.75 pence and is now aiming for 35 pence by the end of next month. Both the 50 and 200-day moving averages are rising, and the stock recently experienced a gap higher, underscoring strong bullish momentum.
NAF: Poised for a Move Up
Despite recent updates, NAF has pushed through its 200-day moving average at 0.55 pence, with a RSI bounce off 50 supporting a positive outlook. Staying above the 50-day average at 0.46 pence and channel floor is essential as the stock targets 0.85 pence by next month’s end.
Quantum Blockchain: Potential Bottom Fishing Opportunity
Quantum Blockchain shows promise with rising 50 and 200-day moving averages and an RSI rebound. A retest of June resistance at 1.14 pence is possible while holding above a rising 50-day line at 0.67 pence, making it an interesting option for those looking to bottom-fish.
Tungsten West: Back in Business with Strong Setup
In the context of current geopolitical tensions, Tungsten West has surpassed its second target at 14 pence and now eyes a move toward 21 pence, the previous resistance from July 2022.
The stock exhibits an extended U-shaped or saucer-shaped turnaround, indicating cautious but growing investor confidence. Holding above 14-22 pence is a positive sign for further gains.
Wishbone: Smart Money Moving In
Wishbone appears to be attracting smart money flows, with investors shifting out of Greatland Gold into this name. The stock has hit its first target of 0.28 pence and is now pushing toward 0.50 pence by the end of next month.
This upper target aligns with resistance on the downside and the parallel top of its rising trend channel. Maintaining a position above the 200-day moving average at 0.22 pence will be critical for sustained upside.
Disclaimer & Declaration of Interest:
The information, investment views, and recommendations in this Zaks Traders Cafe interview are provided for general information purposes only. Nothing in this interview should be construed as a promotion or solicitation to buy or sell any financial product relating to any companies under discussion or referred to or to engage in or refrain from doing so or engage in any other transaction. Any opinions or comments are made to the best of the knowledge and belief of the commentator but no responsibility is accepted for actions based on such opinions or comments. The commentators may or may not hold investments in the companies under discussion.
